On March 12, 2026, a foreign tanker carrying Iraqi heavy oil caught fire and was damaged in Iraqi territorial waters after an unidentified attack targeted two foreign tankers near Basra, Iraq, according to Iraqi port officials.
Mohamed Ati | Reuters
With the de facto closure of the Strait of Hormuz, two alternative oil pipelines in Saudi Arabia and the United Arab Emirates have suddenly attracted global attention.
The first is Saudi Arabia’s East-West Pipeline Network (Petroline), a roughly 750-mile system that transports crude oil throughout the kingdom, linking Abqaiq on the kingdom’s oil-rich eastern Gulf coast to the port of Yanbu on the Red Sea.
The East-West pipeline has an estimated total design capacity of 7 million barrels per day following recent expansions, and Saudi oil giant Aramco said earlier this week that it expected the network to reach full capacity within days.
The second smaller pipeline is the UAE’s Abu Dhabi Crude Oil Pipeline (ADCOP), or Habshan-Fujairah Oil Pipeline. The approximately 398-mile pipeline from the Habshan onshore oil facility to Fujairah is estimated to process 1.5 million barrels per day, with a reported total capacity of nearly 1.8 million barrels per day.
Importantly, both of the replacement Gulf infrastructure bypass the Strait of Hormuz, a key oil chokepoint that has been blocked since the United States and Israel launched attacks against Iran on February 28.
Iran has retaliated by targeting ships attempting to pass through the narrow maritime corridor, with several incidents reported in recent days.
Taken together, energy analysts said the East-West pipeline and ADCOP could help partially offset the roughly 20 million barrels per day that normally passes through the Strait of Hormuz. However, the risk of infrastructure damage amid the widespread Middle East crisis remains an ongoing challenge.
Oil transfer pipes and storage silos at the UAE port of Fujairah.
Duncan Chard | Bloomberg | Getty Images
“Saudi Arabia and the UAE have already increased their use of pipelines that bypass the strait,” Naveen Das, senior oil analyst at global trade intelligence firm Kpler, told CNBC in an email.
“In the UAE, we estimate that the 1.5 million barrel ADCOP pipeline is operating at 71% utilization, with approximately 440,000 barrels per day (barrels per day) remaining. ADNOC can temporarily increase throughput to 1.8 million barrels if necessary,” Das said.
He added that the prospect of attacks on energy infrastructure across the country could limit this total capacity estimate.
Indeed, multiple media reports cited anonymous sources as saying that Abu Dhabi’s national oil giant has reportedly shut down its massive Ruwai refinery after a fire broke out at a facility within the complex. CNBC has reached out to an ADNOC spokesperson and is awaiting a response.
The Ruwai complex in the UAE is estimated to be able to process 922,000 barrels of crude oil per day.
“With crude supplies becoming increasingly constrained in the Gulf region, refineries may soon be forced to adjust operations, cutting operations and redirecting production solely to the domestic market as product exports slow,” Pankaj Srivastava, senior vice president at energy research firm Rystad Energy, said in a research note.
“Although the UAE’s Abu Dhabi Crude Oil Pipeline (ADCOP) allows crude oil exports to bypass the strait via Fujairah, refined products from the Ruwais complex remain heavily dependent on the tanker route through Hormuz,” Srivastava said on Thursday.
“As a result, UAE refineries may still need to adjust product exports or manage inventory buildup if maritime transport remains restricted,” she added.
Impact on energy markets
Oil prices have been extremely volatile since the outbreak of war with Iran last month, with global benchmark Brent crude rising to nearly $120 a barrel at the beginning of the week, before falling to around $90.
Crude oil futures were last seen trading near $100 a barrel on Thursday morning as more attacks on ships were reported in the Persian Gulf.
“The longer this conflict goes on, the more these storages will fill up and there will be nothing to do but cut production,” Marex energy market analyst Sasha Foss told CNBC’s “Early Europe” on Wednesday.
He estimated that the Iran war had reduced Iraq’s oil production by up to 70% and warned that further production disruptions could cause oil prices to rise further.
“When you see countries like Saudi Arabia and the UAE cutting back on oil, that’s when you’re going to see a big blow to the global oil market,” Foss said.
